A self-managed superannuation fund (SMSF) can be a vehicle to help you take full control of your retirement with property, but David Hasib of Chan and Naylor says investors must know what they're in for prior to setting one up:
1. To set up a viable SMSF it's wise to have at least $200,000 in your existing superannuation fund otherwise the costs of administering the fund (minimum $1000 annually) can make the exercise unviable.
2. Your SMSF must be classified as a complying Australian superannuation fund.
3. You must become a trustee of the SMSF - this means you're responsible for managing the fund and only access it according to the law.
4. You must set up and execute an appropriate investment strategy with the assistance of SMSF professionals.
5. You must always comply with the sole purpose test in the fund to maintain tax concessions are available (eg. buying a holiday home to occupy is in most cases a no-no).
6. Always keep assets separate from personal affairs.
7. Follow the superannuation and tax rules in the trust deed, which are set up and updated by an SMSF professional.
8. Know your restrictions - what you can or can't do (eg. borrowing and lending).
9. Know what retirement planning strategies you can use to achieve your goals and objectives.
10. Do you need to outsource? Know what you're truly capable of doing and what you should outsource (eg. tax returns, administration, reporting and auditing). If you're satisfied you have what it takes to set up a SMSF then you need to: set up a trust, choose to be a regulated fund with tax file number and Australian Business Number, write your investment strategy, then set up the trust bank account. The rest is history.
For more information about self managed super funds, speak to one of the financial planners at Intellichoice today.
1. To set up a viable SMSF it's wise to have at least $200,000 in your existing superannuation fund otherwise the costs of administering the fund (minimum $1000 annually) can make the exercise unviable.
2. Your SMSF must be classified as a complying Australian superannuation fund.
3. You must become a trustee of the SMSF - this means you're responsible for managing the fund and only access it according to the law.
4. You must set up and execute an appropriate investment strategy with the assistance of SMSF professionals.
5. You must always comply with the sole purpose test in the fund to maintain tax concessions are available (eg. buying a holiday home to occupy is in most cases a no-no).
6. Always keep assets separate from personal affairs.
7. Follow the superannuation and tax rules in the trust deed, which are set up and updated by an SMSF professional.
8. Know your restrictions - what you can or can't do (eg. borrowing and lending).
9. Know what retirement planning strategies you can use to achieve your goals and objectives.
10. Do you need to outsource? Know what you're truly capable of doing and what you should outsource (eg. tax returns, administration, reporting and auditing). If you're satisfied you have what it takes to set up a SMSF then you need to: set up a trust, choose to be a regulated fund with tax file number and Australian Business Number, write your investment strategy, then set up the trust bank account. The rest is history.
For more information about self managed super funds, speak to one of the financial planners at Intellichoice today.
